NEW DELHI: The government has set a road map for locally assembling parts used in mobile phones till the year 2020, which will enable mobile phone and component industry to plan their investments in India.

Under the PMP, which will be the first of its kind set of rules, the government has identified 12 new parts used in mobile phones which have to be made locally over the next few years.

"While the fiscal incentives to promote cellular mobile handsets will continue, in addition to these, in order to promote depth in manufacturing of domestically manufactured mobile cellular mobile handsets, a phased manufacturing roadmap has been prepared keeping in view the state of play of the design/ manufacturing ecosystem in the country, wherein through appropriate tariff interventions and financial incentives, indigenous manufacturing of the various sub-assemblies that go into the manufacturing of mobile handsets shall be promoted over a period of time," the notification by the ministry of electronics and information technology read, as seen by ET.

"The PMP shall also be extended to parts/sub-parts and inputs of aforesaid sub-assemblies, starting with charger/ adapter, as the manufacturing ecosystem evolves over a period of time… The department of revenue, ministry of finance shall bring out appropriate enabling notifications for giving effect to the aforesaid PMP, on a yearly basis," the notification added.As per the notification, for 2016-17, local sub-assembly of charger, adapter, battery pack and wired headset has been formalised. These parts were included in the differential duty regime in budget for the financial year gone by.

In the present financial year, mechanics, die cut parts, microphone and receiver, key pad and USB cable have been identified for local sub-assembly. In the 2018-19 fiscal, printed circuit board assembly (PCBA), camera module, connectors and antenna will have to be done locally while in the 2019-2020 financial year, display assembly, touch panel/cover glass assembly, and vibrator motor or ringer will be required to made locally.

Local manufacturing of mobile phones is the bedrock of Prime Minister's Make in India program under which more than 30 companies, including world's leading contract manufacturers Foxconn and Wistron, set up operations. A number of component makers have also invested here, as the government gave duty differential as an incentive to make locally, which made importing of fully made mobile phones expensive by 11.5 per cent.

The local manufacturing push resulted in over 75 per cent of the phones used in India to be made locally. However, the government is now wants value addition instead of plain assembly.

The notification or the rules, now lays down a roadmap of which parts would be locally assembled to promote deeper level of manufacturing of mobile phones in the country, which is the second largest smartphone market after China by number of users, and despite global slowdown remains the fastest growing smartphone market in the world.

"The formal notification of the phased manufacturing programme is a historic event in the Prime Minister's path breaking Make in India and Digital India programs. With the consequent PMP – II which is in the works, in 3 years it is proposed that value addition will increase to 39 – 50 per cent," said Pankaj Mohindroo, president of the Indian Cellular Association that represents all handset makers like Samsung, Apple, Micromax and others.